The Icehouse turns 20 this week. But new chairman David Downs and group CEO Gavin Lennox are looking forwards as much as backwards, with calls for changes to two areas of Government policy - and a challenge for themselves, and others in the business incubator and venture capital game.
The pair want tax breaks for employee share ownership (esop) programmes as a "quick win" to help divert more funds from housing to business growth; a change to the Investor Visa scheme to exclude a holder from funnelling their $10 million into government bonds or housing; and they want their own sector to do better on diversity.
"The challenge for the New Zealand economy is, of course, that we have a capital gains-free part of the economy in the housing sector, and productive capital that goes into businesses - whether it's your own business or whether you're investing in someone else's business - doesn't get the same rewards," says Downs, who took the Icehouse reins from long-time head Andy Hamilton last year.
"Now that's a really big topic, but employee share options is one part of it that actually could be fixed relatively easily without disrupting the rest of the system. So it feels like a quick win."
Lennox adds, "many people invest in startups where very little cash is being generated by the business [in its early days]. The opportunity with esops would be to give people tax breaks on the income earned from the capital and value they create with those startups."
Immigration is another area where The Icehouse's new managers want change. But with the argument over more visas for skilled tech staff already well canvassed, the group is focusing its energy on another element.
"New Zealand has some settings around getting investment into the country through the investor-migrant model. There's been a bit of news about it lately," Downs says - referring to the recent revelation that billionaire Google co-founder Larry Page holds NZ residency through our Investor Visa programme. That programme allows an applicant, and their family, to skip most of the usual requirements about days spent in NZ, English language proficiency, age and other criteria if they pledge to invest at least $10m over a minimum of four years. The Investor Visa also has a $3m tier, but at that level lots of the regular requirements around language and so on are retained, and much more time must be spent in this country.
The Government did not detail how Page spent his $10m, but in his case there is definitely startup action involved. A company backed by the Google billionaire is developing a pilotless flying taxi at a site outside Christchurch. But The Icehouse would like to make that the rule, rather than the exception.
"What we'd love to see is that capital being deployed into really productive systems and assets like businesses and companies, not in government bonds or housing," Downs says.
"So what incentives could we create to make sure that those investor migrants are coming in and really growing the New Zealand economy as part of the investment?"
Currently, Immigration NZ has five areas of acceptable investment for Investor Visa holders: NZ companies owned by overseas companies; new residential property; commercial property; philanthropic investments; and growth investments.
There is already a slight lean toward The Icehouse's desired growth category. Investors in the $10m (tier 1) and $3m ( tier 2) are promised "priority processing" and unspecified shorter waiting times. And tier 2 investors can earn extra points toward their visa, or a $500,000 discount on the minimum investment threshold if they put their money into business growth opportunities. Downs would like to see stronger incentives.
New Zealand's low productivity rate is the other major area Lennox and Downs want to address, both through The Icehouse's own initiatives to help SMEs and startups, and by trying to encourage our policy makers to do more to support an environment that encourages high-growth businesses. That includes making it easier for them to bring in highly skilled staff - who are often, ironically, a catalyst for creating more local jobs.
Changing Government policy is a slog, but NZ Trade & Enterprise veteran Downs is familiar with a few of the levers, and he and Lennox were about to embark on a round of lobbying after they spoke to the Herald, starting with a briefing to the Productivity Commission.
In terms of the diversity challenge for their own sector, and the startup scene as a whole, Downs and Lennox freely admit there's a degree of irony in them raising the issue.
"We should address the elephant in the room: we are not the most diverse-looking people on the planet," Downs says.
"The reality is that actually the New Zealand business economy has changed, matured, become more diverse. But it needs to go further. So it's not like we're done.
"We're seeing many, many more businesses that are female-founded and businesses that are integrating different ethnicities -- Māori-owned, Pacific-owned. So it's wonderful. As part of that, The Icehouse also needs to think about how do we add value to those sorts of businesses."
He adds, "we have an economy around us that is changing; our customers are changing, and our business needs to reflect that. So part of what we were doing at the Icehouse is always thinking: 'are we relevant for the types of companies we want to serve?'".
The recent Digital Skills Aotearoa report found Māori and Pasifika make up less than 7 per cent of staff working in New Zealand's tech sector - which features heavily in The Icehouse small business assistance programmes and VC investments. Only around a fifth of roles are held by women.
Beyond the obvious equality concerns, the lack of diversity has contributed to the tech skills shortage. The report recommended that both the education system and the private sector do more to encourage a full range of secondary and tertiary students to take "STEM" subjects, and for the private sector to up its game too, with more in-house training and less intimidating hiring.
And while Lennox and Downs are straight from Corporate White Male central casting, the Icehouse "First Cut" crew - younger partners and associates who dish out funds to very early-stage companies - are notably more diverse.
Changing attitudes, and helping with upskilling, will be nothing new to The Icehouse as it enters its next two decades.
The Icehouse began in August 20 years ago, born out of two ideas, Lennox says.
"One was from a conference called The Knowledge Wave hosted by Auckland University back in 2001.
"The other was the visionary thinking of David Irving, who was the ex-CEO of Watties. He saw a real gap in small-to-medium business owners' business education. They often may not have had much formal education, and may not have access to the type of training he had as chief executive of a large company. So the Icehouse was born from that."
Over the past 20 years, the Icehouse has helped more than 1000 people through its owner-manager programmes, Lennox says, plus another 3500 small-to-medium business through its workshops.
"From the venture capital or angel investing side, we've invested in more than 240 companies," he says. "Today, Icehouse Ventures has around $165m of funds under management."
"And it has had a tangible benefit for New Zealand," Downs says.
"Our opportunity for the next 20 years is really to grow that out and work with the rest of that ecosystem. There are now thriving capital markets and there are lots of great organisations out there, in the government and private sector. The Icehouse has got an integral part in this team for growing New Zealand for the benefit of everybody, not just the business owners, but employees and the whole sector.
"So the next 20 years will be just as exciting as the first 20. And they were a good ride."
David Downs: A health check
Although fighting fit when he visited the Herald this month, by the standards of most medical technology today Downs shouldn't be alive.
In January 2017 he was diagnosed with non-Hodgkin lymphoma and, after multiple rounds of chemotherapy failed, given nine to 12 months to live.
A lifeline came when Downs became one of only 180 people accepted into an experimental CAR T-cell therapy trial run by Harvard University at Massachusetts General Hospital in Boston. The therapy uses the patient's own immune cells to attack cancer cells.
After travelling to Boston 12 times over 18 months, Downs became one of 70 trial participants to go into remission. But as Covid border closures closed in, it was a close-run thing.
"Our final trip to Boston was in February last year, and they were literally closing the airport around us," he says.
Downs says he knows Covid border closures have caused cancer suffers stress, with options for treatment in Australia, the US and elsewhere reduced, and issues with being immunocompromised.
The brighter news is that Downs successfully supported efforts to bring CAR T-cell therapy to New Zealand. The Wellington-based Malaghan Institute, which is run on a mix of Crown, corporate and philanthropic backing, is now offering trial therapy at the same level as Harvard.
Could the cancer come back?
"I choose not to worry about it," Downs says.
"There are so many other things that can get you."